Jay Krishnan

Chai Wala

Submitted by :

Arijit Das, XLRI jamshedpur

Uddalak Banerjee, XLRI jamshedpur

Situation Analysis

STRENGTH

Low Cost Inputs

Labour Skill requirement is low

WEAKNESS

Availability of Capital is low

Fixed costs ( Rental cost )are High

Revenue Earned often is less than the

Operating Cost

OPPORTUNITY

Location of shop is near the road

hence ideal position for sales .

THREAT

Recent construction of Gym is having

adverse impact on business

Customers in the Age group of 20-60Mostly Daily Wage Earners Auto/Taxi/Bus DriversDomestic Help

Recommendation Rationale

Use of Solar cookers AIt will reduce energy consumption and reduce cost

Start selling juice( mango, pineapple and watermelon) and energy drinks A

It will turn adversity into opportunity andencourage gym users to buy drinks from the shop thus increasing sells

Start selling snacks like chips and also eatables like omelette and varieties of dosa.

A

Will increase sales of tea and overall sales and cost incurred to provide these eatables is not high .

In rainy season try selling chat , pakora, samosa .

AChat, samosa, pakora are liked by most people and will increase sales.

Allow advertisements to be displayed as hoardings within and near the shop. a

Will lead to earning visibility money from the advertisers and it will also bring some capital into the business.

Recommendations

Solar cooker INR 2,500.00 Last month Payables 26,000.00INR

Juicer INR 2,500.00 Retained Earnings 3,500.00INR

Cutlery INR 500.00

Dish( 20 pc) INR 1,000.00

Stove INR 2,000.00

Cash INR 21,000.00

Total Assets 29,500.00INR Total Loabilities 29,500.00INR

LiabilitesAssets

ROI - Financial Statements

Balance Sheet for proposed strategy

P&L statement for proposed strategy

Samosa 4,800.00INR Rent + Other Expenses 35,000.00INR

Boiled Egg 2,100.00INR Salary Expenses 12,000.00INR

Omlette( 1 egg) 1,800.00INR Egg 2,250.00INR

Double Egg Omlette 3,000.00INR Potato 3,000.00INR

Tea Masala +Oil 3,000.00INR

Pav Bhaji Fruits 10,000.00INR

Juice 15,000.00INR

Net Loss 17,550.00INR

Total Reveue 65,250.00INR Total Expenditure 65,250.00INR

21,000.00INR

Income Expenditure

ROI - Break-Even Analysis

PRICE

Juice Rs. 40/ glass, Samosa Rs. 10/pc

One Egg omelette Rs. 20, Double Egg

Rs. 40, Boiled Egg 7 Rs pc

Tea Rs. 10/cup

PRODUCT

Juice (Mango, Banana, Watermelon,

Pine Apple)

Omelette , Boiled Egg , Tea

Dry Fruits

PROMOTION

Use Green recyclable Packets , Green

Earth Posters with slogans like “

Clean , Healthy and sustainable

energy used here:

Place posters infront of the gym too

and hoardings at the junction of main

road

PLACE

Keep the same place as it is near the

highway and gym is near it .

Over the years, Jay Krishnan has also

developed a reputation and a known

name.

Customers in the Age group of 20-60Health conscious crowd College studentsLower middle class to middle class segment

Marketing Strategy

Substantial investment is necessaryExpansion of product portfolio

Upgradation of Infrastructure

Marketing

Highly Fragmented MarketLots of small players in the segment

Business Model can be easily imitated

The new target segment has somewhat different tastes andpreferences

Health and Hygiene conscious

May have inclination towards ‘Brand’

Entry Barriers

Substantial investment already madeInventories and stocks

Infrastructure and maintenance

Reputation

Over time, Jay has been able to develop a reputation for himself

With proper strategy, that reputation can be utilized to carve a niche

Regular Customers

There is a set of regular customers who flock Jay’s Tea Shop

For these loyal customers, it might not just be the tea but the wholeambience which matters

These loyal customers have their expectations, which could be capitalizedfor spreading a positive WOM

Cash Flow

Prior to the Gym coming up, there was a steady cash flow

Provide Jobs

Jay also provides employment to 3 helpers

They are paid Rs. 3000/- to Rs. 5000/- per month in all

Exit Barriers

Risk & Mitigation Strategies

RISK MITIGATION

13 months to reach Break-Even

sales

Risk of Market Saturation

Risk of Brand dilution with inferior

quality products

New market development would

be may involve relocation, cost and

heavy investment

New target segment may not

respond favourably

a

Product Diversification

Confectionery

Fast Food

South Indian

after making demand analysis

New Market Development

Home Delivery of Snacks

Phone Booking and Ordering Service

Unrelated Diversification

FMCG section

Stationery suplies

Thank You….